How do I calculate the effective date of termination?
The effective date of termination (“EDT”) is used to calculate the time limit an employee has for bringing a claim for unfair dismissal. Under s97(1) of the Employment Rights Act 1996, the EDT is either:
- The date that a notice period expires (whether the notice is given by the employer or employee); or
- Where no notice is given, the date on which termination takes effect.
This appears a simple concept, and for many employers the calculation of the EDT takes little thought. However recent case law has suggests that an element of caution is required when calculating the EDT.
Where notice is given by either the employer or employee, it is important to establish the start date of that notice. The usual view would be that that notice starts on the day it is communicated unless a future date is specified. However in Wang v University of Keele the Employment Appeal Tribunal stated that unless the contract provides otherwise the notice will run from the day after it is given. This is because part days cannot be accounted for. In Wang the letter giving notice simply stated that the employee was entitled to 3 months’ notice. Therefore the EAT construed the notice in the employee’s interest. To avoid such confusion it is recommended that the letter giving notice expressly states that the date the notice runs from and to and that contracts of employment specify that notice of termination will have immediate effect (whether given verbally or as per the date on the notice itself).
Where there is a summary dismissal the employer cannot just rely upon the date of the dismissal letter as the date of termination. In the case of Gisda Cyf v Barratt the dismissal was not communicated in person to the employee. A letter was sent to Ms Barratt by recorded delivery summarily dismissing her. This was signed for by her son but as she was away caring for a family member she did not open the letter until her return home 4 days later. The Supreme Court held that the EDT was the date that the letter was opened rather than sent because Ms Barratt did not have reasonable opportunity to read the letter beforehand.
This is an important decision and could drastically alter the EDT. As well as being a matter of good practice, because of the Gisda Cyf case it is best to notify employees of summary dismissal in person for certainty as to the termination date. If this is not practical, then in any summary dismissal letter it might be worth inviting the employee to contact you so that you can make arrangements for their outstanding holiday pay or other pay to be forwarded to them. This will provide some incentive for them to contact you and may give you some indication as to when they received the letter.
From the EDT, an employee will have 3 months to bring a claim for unfair dismissal, although the Tribunal may extend the time limit in some circumstances. The last date for a Claimant to bring a claim will effectively be 3 months less one day. For example if the EDT is the 31 March, the last date to bring a claim will be 30 June.
We employ a supervisor who attends a client’s workplace to carry out maintenance work. Unfortunately due to a number of heated disagreements with the client’s employees (which our employee denies) the client has now refused to allow the supervisor on site or we will lose the contract. We have told the client not to worry and that we will sort things out. Are we safe to dismiss our employee given that we cannot afford to let the contract go?
Pressure from a third party can potentially be a fair reason to dismiss an employee and will usually fall within the category of “some other substantial reason”. However it is not a straightforward path to follow without ensuring that you have acted reasonably in the circumstances. Employees should always look to try and seek a solution to the matter and avoid jumping to the conclusion that dismissal is inevitable.
Firstly you need to consider whether the client’s stance is non-negotiable. Talk to the client to establish what their concerns are and make sure the employee is aware of the allegations they are making. Examine whether the employee has been made aware of the seriousness of his behaviour in the past and if the client’s views have been communicated to him.
Clearly the employee may suffer an injustice as a result of your client’s stance, particularly if the heated arguments have not been investigated or found to be his fault, and it is important that you take steps to mitigate against this if possible. For example, could the employee be moved to another location or employed in a different role away from the client? This is even more important if the employee has long service and a good record with you as their employer.
If you are faced with an intransigent client and not co-operating with them would harm the business it may fair to dismiss. However you must be careful not to promise the client any action in advance of you going through your due procedure to investigate and hear the employee’s case. By indicating to the client that you will sort the problem out a tribunal may feel that you have pre-empted the outcome of any proceedings and this will render any dismissal unfair.
You must also be alert to any signs that the client may be acting in a discriminatory manner, for example, asking you to remove a pregnant employee from their site. If this happens contact your HR Rely advisor.
In cases like these an employer is expected to use dismissal as a last resort and to explore all avenues before reaching a decision to terminate employment.
We have dismissed an employee for redundancy and elected to pay him in lieu of notice in accordance with our right to do so under the contract. Since dismissing him we have now discovered that he had committed an act of gross misconduct prior to the dismissal and so we have decided not to pay him in lieu of notice. Are we ok to do this?
Unless the contract allows you to not pay the employee in lieu in these particular circumstances, then no. You have dismissed the employee in accordance with a contractual provision and therefore the employee is entitled to be paid in lieu of notice. If you fail to pay the employee, he can sue you and claim the money as a debt.
If you have not yet paid the employee statutory redundancy pay, it may be that you can withhold this redundancy pay but only if specific circumstances apply. You should speak to your HR Rely adviser if this is a route you want to follow.
You may decide to revisit your contractual wording for new employees and as well as providing the right for you as the employer to pay in lieu of notice, you may wish to state something along the lines of “The Company is entitled to withhold the payment in lieu of notice in the event that prior such payment being made it discovers that you had committed an act of gross misconduct whilst in employment”. Of course if the employee challenges the non-payment of his lieu of notice monies, then you will need to be able to demonstrate the conduct was serious enough to warrant summary dismissal for gross misconduct with the evidence available to support that contention.
If the employee had not been paid in lieu of notice but was instead working his notice, this would have enabled you to take him through the usual disciplinary process and dismiss without notice, and without pay in lieu of notice, if an act of gross misconduct had been committed.
The notice provisions in our contracts provide that both parties are required to give statutory notice to terminate their contract. We have just received one month’s notice of termination from one of our employees but he has now gone off sick and we anticipate he will remain off sick for the duration of his notice period. Do we have to pay him during his notice period?
Your employee will be entitled to some payment during his notice period, the question is how much.
Irrespective of which party has given notice, the Employment Rights Act 1996 provides that where an employer is required to provide the employee with statutory notice then the employee is entitled to be paid if he is unable to work his notice in certain circumstances. These circumstances are where the employee is sick or injured, on family leave, holiday or where the employer has no work to provide the employee. (It is worth noting however that if the contract provides that the employer has to give notice that is one week greater than the statutory notice, these particular provisions of the Employment Rights Act 1996 don’t apply.)
In situations where it is the employee who has given notice and then gone off sick, the employer’s liability for paying the employee during his notice period is limited to one week i.e. the period of statutory notice required by the employee. This is even though the employee has given greater notice. It means that the remaining notice will be unpaid.
However the position will be different if there is any contractual entitlement for the employee to be paid during his absence. If the contract entitles the employee to sick pay then the employee will be entitled to receive sick pay subject to the scheme’s rules. It may be that there is wording in scheme that limits entitlement to sick pay during notice periods.